TORONTO (miningweekly.com) – South Carolina-focused project developer Romarco Minerals has reached an agreement with environmental activist group the Sierra Club regarding the final critical mine operating permit needed for its flagship $333-million Haile gold project, which was issued last year by the South Carolina Department of Health and Environmental Control (SCDHEC).

Romarco said after market close on Thursday it had agreed to increase its environmental bonding for reclamation purposes by $5-million to $65-million over the life of the mine.

In return, the Sierra Club would not appeal the December ruling by the SCDHEC that had dismissed the Sierra Club’s request for review of the permit.

The activist group had also agreed not to launch a lawsuit or file a claim against the Haile project, as it was currently allowed.

The Sierra Club had filed its request for review on the last day of the public comment period.

Analysts at financial services firm Desjardins Capital Markets on Friday said the agreement was “a positive” for Romarco, as the expected negotiated settlement could have been slightly higher than the $5-million increase. Owing to the additional funds being spread over the life of the mine, no additional initial financing would be required.

“Romarco effectively negated a potential costly and drawn out legal process and will not need to use the proceeds of the recent financing for legal purposes and instead will have increased flexibility on the timing of its major financing package,” analyst Michael Parkin said in a note to clients, noting that with all key permits now in place, he believed that the attractiveness of the Haile gold mine project had increased and that the potential for a bid (friendly or hostile) was now higher.

He noted that according to new estimates based on the recently updated technical report, an internal rate of return on the project of 33% was expected, with a slowly rising gold price from $1 200/oz in 2015 to $1 275/oz in 2019 onward.

The next major step for the company would be to secure about $400-million in financing for the Haile project. Romarco had in November signed a binding commitment letter with a consortium of financiers for a $200-million, 8.5-year senior secured project finance facility.

The company added that at the time that it was also evaluating alternatives that might lower the overall funding requirement, including other facilities, equipment lease agreements and surety bonding.

The good news on Friday boosted Romarco’s TSX-listed stock, seeing it rise 7.55% to C$0.57 apiece in early trading.